Bearish Breakaway: Explained in 60 Seconds

A bearish breakaway is a five-candle pattern that begins with an up-gap and ends with a close back inside that same gap.

What the pattern is

Five consecutive candles form the structure. The first candle is bullish and gaps higher, leaving an empty space beneath its open. The next three candles continue in the same direction, each printing inside or above the gap. The fifth candle is bearish and closes inside the original gap, leaving the space unfilled.

What forms it

Price has been rising into the pattern. The opening gap shows strong buying interest that pushes the market higher without immediate follow-through. The three middle candles keep the advance alive, often printing small bodies or modest continuation moves. The final candle reverses that momentum by closing back inside the gap, showing that the earlier buyers have been overwhelmed.

What confirms it

Three conditions must be present before the pattern is considered valid. First, the initial gap must be a genuine separation in price with no overlapping candles. Second, the three middle candles must carry price forward rather than stall or reverse. Third, the fifth candle must finish inside the gap; any close that fills the gap entirely invalidates the setup.

How it fails

If the gap is later closed by price action that drifts back to the pre-gap level, the breakaway never existed. Traders who wait for the gap to disappear before acting are watching a different pattern altogether.